Top CD rates today: Jan. 24, 2024 — Leading 5.51% APY holds steady

A certificate of deposit (CD) is a viable option for savers who want to lock in an annual percentage yield (APY) for a set number of months or years. Today, the highest yield across terms is 5.51 percent on a one-year CD, followed by 5.5 percent on three-month and nine-month CDs.

Top CD rates have remained steady for much of January. However, as of late, there’s been some activity in top-yielding rates. This month, for example, we’ve seen slight drops in top one-year and nine-month APYs, while just today we saw a bump-up in the top three-month yield to 5.5 percent APY from 5 percent APY.

When shopping around for the right CD, consider APY as well as the minimum deposit requirement and a term length that suits your financial goals. Bankrate’s table below lists the top APYs on widely available CDs, as well as how much interest $5,000 would earn for each.

Key takeaways

• The highest APY today across CD terms is 5.51 percent, offered on a one-year term.

• Leading rates are between 5 and 5.51 percent APY on terms of up to two years, while they're between 4.54 and 4.75 percent APY on terms of three to five years.

• It pays to shop around because national averages are just a fraction of the top rates, and some banks continue to offer near-zero rates.

Today’s CD rates by term

Keep in mind:Be sure to choose a CD term length that aligns with when you'll want access to the money for a planned purchase or to reinvest elsewhere.

CDs vs. savings accounts

You can often find high yields these days on both CDs and savings accounts. A liquid savings account is the best place for money you may need in the near future to cover living expenses, emergencies, or other short-term financial needs. A CD is designed for money you can afford to part with for its entire term because withdrawing the money before the end of the term can result in a penalty.

CD rates in 2022 through 2024

National average CD yields rose steadily in 2023, as the Federal Reserve continued to hike interest rates at the fastest pace since the 1980s. In all, Fed officials increased rates 11 times between 2022 and 2023, bringing the federal funds rate to its current target range of 5.25-5.5 percent. Along with these rate hikes, average CD APYs rose to the highest they’d been in many years, with APYs on some competitive CDs climbing as high as 7 percent.

This year is expected to be a banner one for CD savers. Greg McBride, CFA, Bankrate’s chief financial analyst, predicts two Fed rate cuts in 2024, yet he says CD yields will continue to top inflation. “Savers have another good year in which their returns will shine, with inflation expected to decline further,” he says.

McBride also stresses the importance of shopping around for the highest APY. “Top-yielding offers are still going to deliver a notable advantage [over lower-yielding ones],” he adds.

CD FAQs

• Is a CD a good idea right now?

  Although Federal Reserve rate cuts are widely expected in 2024, and banks may lower deposit account rates as a result, CD yields are expected to remain strong overall and outpace inflation. Overall, average yields remain higher than they’ve been in years, while the top APYs on many terms are more than triple the national averages.
  
  Opening a competitive CD now means you won’t be missing out on a high APY should rates start to fall later this year. Because a CD typically earns a fixed rate, you’ll continue to earn the same yield throughout its entire term, even if rates on new CDs start to drop.

• What are things to consider when choosing a CD?

  Before committing money to a CD, make sure you’re comfortable parting with the funds for the entire term; withdraw the funds early and you’ll likely be hit with an early withdrawal penalty. As such, a CD isn’t a good place for your emergency fund. Other factors to consider include:

  • Annual percentage yield (APY): Not all banks are equal when it comes to APYs, so it pays to check out what various banks are offering. Online-only banks are known for paying high yields, so they’re a good place to start your search.

  • When you’ll need access to the money: CDs commonly come in terms between three months and five years, although you’ll sometimes be able to find terms as short as one month and as long as 10 years. Make sure you choose a term that corresponds with when you’ll want the money for a planned purchase or other investment.

  • Minimum deposit requirement: Some banks, such as Ally Bank and Synchrony Bank, don’t require any set minimum deposit, while others may require $1,000, $5,000 or even as much as $10,000. When shopping around, find a CD with a minimum deposit that aligns with your saving goals.

  • Federal deposit insurance: Before opening a CD, make sure the bank is insured by the Federal Deposit Insurance Corp. (FDIC). Likewise, if it’s a credit union, make sure it’s insured through the National Credit Union Administration (NCUA). This way, should the financial institution close its doors, your funds will be insured for up to $250,000 per depositor, per insured bank or credit union, for each account ownership category.

• Can you lose money in a CD?

  Your money is protected in a CD when it’s with a bank insured by the Federal Deposit Insurance Corp. (FDIC) or a credit union insured through the National Credit Union Administration (NCUA). When institutions are covered by this federal insurance, CDs and share certificates are each insured for up to $250,000 per depositor, per insured bank or credit union, for each account ownership category.
  
  CDs typically require that you lock in your money for a set term, and taking out the money before the term ends usually results in an early withdrawal penalty. This penalty causes you to lose some of your interest — and possibly also some of your principal, which is the money you originally deposited in the account.

Methodology

Bankrate calculates and reports the national average APYs for various CD terms. Factored into national average rates are the competitive APYs commonly offered by online banks, along with the very low rates often found at large brick-and-mortar banks.

In June 2023, Bankrate updated its methodology that determines the national average CD rates. For the process, more than 500 banks and credit unions are now surveyed each week to generate the national averages. Among these institutions are those that are broadly available and offer high yields, as well as some of the nation’s largest banks.